İKTİSADA GİRİŞ II - Deneme Sınavı - 16

The money created in the form of demand deposits as a result of banks’ credit transactions is called as deposit money.

Less reserve ratio causes more money creation.

The amount of money that economic units want to hold to spend for goods and services is called as transaction demand for money

Ms ↑→ i↓→I↑→AE↑→Y↑

Financing the transactions of the government is not one of the functions of the central bank.

Unit of account function of money means that it is the common measurement unit in quantifying the value of goods and services.

Store of value function of money means that it ensures to keep purchasing power on hand.

Commodity money is the object which has both values as a good and a medium of exchange.

Fiat money is the object which has no value as a good but has a value in purchasing goods and services.

Near money is an asset that has high liquidity but cannot be used directly in payments.

Deposit money is money in the form of a demand deposit that is created by banks as a result of accepting deposits and loaning of funds.

III – I – II is true if the give assets are ordered from the least liquid to the most

The price of this bill when the market interest rate increases to 12% is 80TL.

When a bond with an annual interest payment of 100 TL has been sold for a price of 1250 TL, the interest rate of this bond is equal to 8%

The velocity of money is 12.5 if the monetary value of the production (P x Y) of an economy is 5.000 TL and the quantity of money to pay for final goods and services in this economy is 400 TL.

Aggregate demand is the total amount of goods and services demanded at various price levels by all sectors in an economy (households, firms, government, and external world). The total amount of these goods and services is measured by real income or real GDP.

Aggregate demand curve is the curve that shows the relationship between general price level and production level.

In obtaining the aggregate demand curve, we have assumed that the variables of the economic policy that the government use are fixed. Changes resulting from government expenditure (G), taxation (T) and money supply (MS) due to monetary and fiscal policy decisions cause the aggregate demand curve to shift.

There are different approaches among economists regarding the shape of the short-run aggregate supply curve, in other words, the slope of the short-run aggregate supply curve. Classical economists argue that the short-run supply curve is completely vertical or rather steep because the economy is always at full of employment as a result of dynamics of the market mechanism.

The cost changes that cause the displacement of the aggregate supply curve are called cost or supply shock.